The Trump administration on Wednesday blocked a Chinese-backed investor, Canyon Bridge Capital Partners, from buying Lattice Semiconductor, a California maker of highly programmable computer chips, Bloomberg reports. Earlier in the day, officials separately blocked federal agencies from buying software from Kaspersky Lab, a Russian cybersecurity company, amid concerns about Russian spying.
“Kaspersky Lab has never helped, nor will help, any government in the world with its cyber-espionage or offensive cyber efforts, and it’s disconcerting that a private company can be considered guilty until proven innocent, due to geopolitical issues,” the company replied in a statement.
Other foreign tech companies facing similar challenges under the Trump administration include:
- Chinese network equipment maker Huawei, which has been blocked from selling to U.S. phone companies amid spying concerns by federal officials
- Chinese drone giant DJI, which the Army reportedly banned amid security concerns
- Hong Kong’s TCL Industries, which abandoned plans to buy the MiFi mobile Wi-Fi hotspot brand from San Diego’s Inseego after regulatory scrutiny over security risks
- Hangzhou Hikvision Digital Technology, a large Hangzhou-based surveillance camera provider whose controlling shareholder is the Chinese government, has faced citizen complaints in the U.S. and U.K. over security concerns and its relationship with the Chinese government. Canadian surveillance software company Genetec has also refused to provide free tech support for Hikvision or Huawei over similar concerns, according to Voice of America.
Chinese purchases of U.S. companies–now at their highest rate in years–have been getting added scrutiny from the Committee on Foreign Investment in the United States (CFIUS), the quiet U.S. government panel charged with reviewing acquisitions by foreign entities for potential national security risks. CFIUS blocked the Lattice deal, and is considering a number of other deals, according to a July Reuters report. Ant Financial’s $1.2 billion purchase of MoneyGram, China Oceanwide Holdings Group’s $2.7 billion acquisition of life insurer Genworth Financial, and China-based semiconductor investment fund Unic Capital Management’s $580 million acquisition of chip testing company Xcerra are all under scrutiny now.
Of course, foreign countries, notably China, restrict, censor, or altogether block U.S. businesses from selling or operating their services, for various reasons. China, for instance, has kept out digital services from U.S. tech companies like Google and Facebook to the benefit of the country’s security services and to its homegrown digital platforms like WeChat.
U.S. vendors like Apple and Cisco were reportedly dropped from China’s list of approved government suppliers after Edward Snowden’s revelations about NSA spying. Russia has previously threatened to retaliate in kind for any U.S. ban, though it’s not clear which tech companies the Kremlin may target.SM